Too Dumb to Meter, Part 10

04/01/2013 | Kennedy Maize

As the book title Too Dumb to Meter: Follies, Fiascoes, Dead Ends, and Duds on the U.S. Road to Atomic Energy implies, nuclear power has traveled a rough road. In this POWER exclusive, we present the 18th and 19th chapters, “The Great Uranium Conspiracy” and “Breeding at the Turkey Farm,” the final two chapters of the “False Scarcity and Fools for Fuels” section.

18. The Great Uranium Conspiracy

It was an unremarkable day in Sacramento, California, when Jim Harding arrived at his office at the California Energy Commission in the summer of 1976. Harding, a young resource economist who had previously worked for the feisty environmental advocacy group Friends of the Earth, was an assistant to Ronald Doctor, an economist who served on the commission created by the state legislature in 1974 to serve as an antidote to the perceived industry bias of the California Public Utilities Commission.

As Harding recalled thirty-five years later (unsure of the exact date of the transaction), he was in his office that morning when Dale Bridenbaugh, a nuclear engineer who had recently left General Electric with two other engineers in an anti-nuclear blast against their former employer, showed up with a two-inch-thick package wrapped in plain paper. Bridenbaugh had no idea what was in the package. He was delivering it to Harding following a visit to Australia. In Australia, the local chapter of Friends of the Earth asked Bridenbaugh to take the package to Harding, someone they trusted who was in a position where he could make use of the information.

Harding said later he didn’t know who in the Australian group decided to ship the papers to him. “I never really knew who in Australia had gotten it to me,” he said in an interview. “I had done a speaking tour there on uranium, so that’s probably how I came to their attention.”

When Harding peeled off the wrapper, he discovered a trove of material from the files of Mary Kathleen Uranium, the only Australian uranium mining company at the time. The pages documented two years in the history of a worldwide government and industry cartel organized to manipulate the price of yellowcake on the world market. The Mary Kathleen papers kicked off a major political and foreign policy dispute involving virtually all of the uranium producers and users around the globe and straining relationships among the United States and some of its closest allies, including France, England, Australia, and Canada.

As it turned out, the uranium cartel was a direct product of the misguided policies and practices of the Atomic Energy Commission with regard to the supply of uranium. By first creating a glut of uranium in order to supply its burgeoning weapons program, the AEC produced a predictable result: a crash in prices that destroyed all but the biggest U.S. players in the market. Then, reacting awkwardly to the unintended consequences of its push for production at any price, the AEC furthered the reach of its government-created buyer’s monopoly. The agency continued to deny potential customers access to the uranium market on their own, forcing them to transact their business through the U.S. government. Finally, the AEC effectively denied foreign producers access to the U.S. uranium market—the largest in the world—by erecting protectionist barriers to foreign suppliers.

The foreign producers—governments themselves plus the multi-national, trans-governmental firm Rio Tinto Zinc—responded in the only way they thought they could. They created a marketing cartel designed to increase prices outside the restricted U.S. market and divvied up the market among the members of the cartel, which they dubbed “The Club.” That these actions violated U.S. law mattered not at all to the international cartel. They viewed the United States as a commercial enemy and U.S. antitrust law as a cynical device to restrict competition in uranium markets. One history of the Club noted that the U.S. embargo “created bitter feelings among foreign producers who were also in desperate straits, and it divided the industry into two parts—the United States and the rest.”

This attitude has persisted well into this century. In a 2004 memoir, Terry Price, a well-known British figure in the world of uranium and key staff player in the uranium cartel, commented that the purpose of the Club “was to defend the embryonic nuclear industry against the deliberate exploitation of massive purchasing power by a monopolistic uranium customer. Once the whole picture was revealed, the Club appeared to be one of the world’s more forgivable cartels.”

When Harding opened the package from Australia in August 1976, he knew he had something hot. There had been rumors of the cartel in the trade press since the formation of the Club in 1972. Nuclear Industry magazine in its February 1972 issue reported on the formation of the cartel at its first meeting in Paris: “Despite persistent rumors that the major uranium producing countries—except the United States—would soon try to end the price cutting that has been hurting them all, the news that they are actually trying to negotiate an armistice surprised most observers.” The first word of the move was an Australian government announcement that an official delegation would go to a Paris meeting with French, South African, and Canadian delegations to discuss future agreements to secure orderly marketing.” The Wall Street Journal and the Journal of Commerce both reported on the birth of the cartel in Paris February 1–4, 1972.

Westinghouse chairman and CEO Robert Kirby, who took charge of the company in mid-1975 and led it during the uranium business meltdown, shortly before he took office noticed what he thought was international hanky-panky. In a history of Westinghouse, the Pittsburgh Post-Gazette newspaper wrote, “Early on in his uranium work, Kirby began casting a suspicious eye across the Golden Triangle to Gulf Oil’s art-deco headquarters. Gulf was a uranium supplier, and Kirby smelled a rat.”

By mid-1975, the New York Times reported that “the Justice Department is investigating charges that a new international uranium cartel violates United States antitrust laws.” In fact, a federal grand jury in Washington had been meeting for several months investigating the existence of a uranium cartel and its relationship to U.S. antitrust law.

Harding shared his trove of documents with his boss, Ron Doctor. Together, they contacted Leonard Ross, a brilliant young lawyer whom Gov. Jerry Brown (in his first term as chief executive of the Golden State) had appointed to the public utilities commission.

At Ross’s insistence, the California officials contacted the Justice Department, which expressed an interest in their documents. “When we contacted the DOJ,” Harding recalled, “they were instantly interested. They told us to make two copies, put one to them in overnight mail, and send the other by regular mail, and keep the original ourselves. They also then sent a courier for a copy. They obviously wanted it.”

The package they mailed to Attorney General Edward Levi and Senate Foreign Relations Committee chairman Frank Church (D-ID) included a cover letter. In it, Richard Maullin, energy commission chairman, and commission members Emilio Varanini, Doctor, Ross, and Harding wrote, “if the foreign cartel continues and America’s nuclear commitment increases as planned we will be at the mercy of a uranium OPEC.”

The Mary Kathleen papers provided incontrovertible evidence about the cartel, in fascinating detail. It outlined how the members of the Club divvied up the market, set prices, determined who would win in allegedly competitive auctions, set up mechanisms to discipline its members, and maintained secrecy. As the documents showed, the kingpin of the organization, and its largest beneficiary, was Rio Tinto, with operations in all of the countries represented in the organization. The Club’s members included the governments of France, Australia, Canada, and South Africa, although the governments’ roles were indirect, working largely through private or government-owned uranium companies, such as Gulf Minerals Ltd. Canada. The governments operated sub rosa. Only those with a “need to know” were fully apprised of the activities.

The Club tried to maintain strict secrecy for a number of reasons, including the wish to avoid political controversy, which occurred in Canada once the Mary Kathleen papers surfaced. The cartel also wanted to fly under the radar of various national antitrust laws, particularly the very strict U.S. antitrust regime. Perhaps most importantly, the Club did not want to overtly confront the U.S. Atomic Energy Commission, which could withhold its enrichment services, necessary to turn uranium yellowcake into useful reactor fuel. At that point, the United States enjoyed a virtual monopoly on commercial uranium enrichment services. The history of the cartel, Yellowcake, by June H. Taylor and Michael D. Yokel, commented, “The problem of a possible refusal by the United States AEC to enrich Club uranium arose over the cartel’s policy of discriminating against middle-men.” The most significant middleman in the uranium market at the time was Westinghouse.

The four producing nations in the cartel excluded their domestic markets from the price-fixing arrangements, and the cartel deliberately avoided the U.S. market. The exclusion of the United States was not only a prudent precaution but reflected the practical state of the market. Given the U.S. ban on uranium imports, the foreign suppliers had no direct access to the U.S. market. The Club believed it was protected from troubles in the United States, but that protection proved to be weak.

The Mary Kathleen papers exposed the Club, creating the publicity and the political problems the cartel hoped to avoid. The immediate response of the governments involved in the cartel was to deny the accusations. A spokesman for the French government said his country had “no knowledge of any such cartel in which French interests, public or private, would be represented.” Questioned about the 1972 meeting in Paris, the French response was that the meeting was open and “even distributed a final communiqué in French and English explaining its purposes.” The United States was not invited to the meeting, said the spokesman for France, because the United States was not a uranium importer and could not be hurt by the actions of the Uranium Institute.

But when the Australian uranium archive came to light, Westinghouse immediately filed an antitrust lawsuit against twenty-nine uranium producers, including Gulf, as a counter to the utility suits against Westinghouse for its failure to provide contracted fuel. In a suit filed in October 1976, Westinghouse claimed that the Club pushed up uranium prices by 500 percent, leading to the collapse of Westinghouse’s short position in the uranium market. The suit filed in U.S. District Court in Chicago sought triple damages from U.S. companies including Gulf, Engelhard Minerals, Anaconda (acquired by oil company Atlantic Richfield), Getty Oil, and Utah International (acquired by General Electric). The first step in the law suit was discovery, where Westinghouse began sorting through the business records of the defendants, notably those of its Pittsburgh neighbor, Gulf.

At the same time, Congress was getting into the act. The House Interstate and Foreign Commerce Committee’s oversight and investigations subcommittee in November 1976 began a series of probes of the uranium market, under the leadership of California Democrat John E. Moss, ironically representing a Sacramento district. Moss, the son of a coal miner, was a committed New Deal liberal and an aggressive investigator who served thirteen terms in the House from 1953 to 1978 and was the father of the Freedom of Information Act. The Moss subcommittee’s first hearing took place in Sacramento.

In May 1977, Moss’s staff picked up some hints, from Westinghouse’s trolling through the Gulf papers during discovery, that Gulf was intimately involved in the cartel’s price fixing. If true, that would be a clear violation of U.S. law and a legal hook on which to hang a high-profile congressional investigation. The problem with the story of the uranium cartel was that tying it to the U.S. market and U.S. law was proving difficult.

The Moss subcommittee scheduled a hearing for early May 1977 and subpoenaed Westinghouse to appear and produce all the material it had obtained from Gulf during legal discovery. On the morning of the hearing, May 2, 1977, Gulf went to court, getting a temporary restraining order from a federal court in Washington preventing Westinghouse from turning over the discovered documents. Westinghouse, placed in what one historian called a “no-win position,” chose to honor the court order. In response, congressional lawyers threatened a contempt of Congress citation—arguing that settled law holds that Congress, as an independent body under the U.S. Constitution, is “immune from judicial interference and has a right, independent of any other branch of government, to obtain information for which it issues a subpoena.” When Westinghouse continued to follow the court’s restraining order, Rep. Henry Waxman (D-CA), acting as chairman of the full Commerce Committee, found Westinghouse in contempt.

A day later, U.S. District Court Judge George Hart removed Westinghouse from the horns of its legal dilemma, refusing to turn the temporary restraining order into an injunction against release of the Gulf material to the congressional committee. Westinghouse lawyers immediately turned the material over to the Moss subcommittee.

Still fighting to hide its role in the cartel from public scrutiny, Gulf tried to persuade the congressional investigators to withhold the material from the public. The oil company’s lawyers offered two reasons why the material should be kept confidential, neither of which convinced the investigators. First, said Gulf, the papers were protected by the lawyer-client privilege against public disclosure, a common-law precedent. Also, Gulf said, release would violate Canadian law designed to protect information about uranium supplies. The committee concluded that the privacy privilege didn’t apply when the advice of the lawyers was how to commit fraud, and that Canadian law doesn’t apply to the U.S. Congress, particularly when it appeared that Gulf helped formulate the Canadian regulations in order to prevent exposure in the United States.

The committee also issued subpoenas for various foreign participants in the cartel to appear at the hearings. The governments and private business officials largely ignored those orders, although it sometimes cramped their travel plans. In Yellowcake, Taylor and Yokell recounted a fiasco in which the Moss investigators learned that an executive from a Canadian uranium firm, Rio Algom, was at a U.S. airport and notified U.S. Customs to pick him up. But the executive, G.R. Albino, made his flight before the feds could nab him.

As the hearings got rolling in June, Canada launched a public relations counter-offensive. On June 16, 1977, Canadian finance minister Donald S. Macdonald, speaking in Ottawa, attacked the Moss investigation and the U.S. government. He called on President Carter, who took office in January, to halt the investigation. Macdonald, previously Canada’s minister of energy, mines, and resources, said, “We acted to protect ourselves from these predatory American tactics, and now they are saying ‘you are maintaining a cartel.’” Macdonald added, “They have an ambassador here in Ottawa. Maybe he had better take a message back to Washington that there is not one law for the United States and a different one for everybody else.”

The next day, Macdonald, never denying the existence of the cartel or his government’s support for it, told the Canadian parliament that American policies in the early 1970s, including the export ban to protect U.S. producers, forced the creation of the international cartel. Macdonald argued to the House of Commons that the United States was trying to impose its antitrust laws on Canada. “I don’t regard that as a friendly act,” he said.

Newly appointed U.S. Attorney General Griffin Bell, in Canada for bilateral talks on legal issues between the countries, and U.S. ambassador to Canada Thomas Enders were sitting in the gallery during Macdonald’s attack. Reuters reported that Bell said later that the United States wanted to settle its dispute with Canada through “conciliation and accommodation,” but without elaboration.

As Macdonald was talking to reporters in Ottawa, the Moss subcommittee opened its hearings in Washington on the uranium cartel by grilling Gulf Oil Corp. executives about the meaning and intent of the documents the committee released during the hearing. Gulf chairman and CEO Jerry McAfee and S.A. Zagnoli, president of Gulf Minerals Resources Corp., the uranium subsidiary, somewhat contradicted the position the company had laid out in a prepared statement. McAfee and Zagnoli admitted to the subcommittee that the cartel accomplished its goal of raising uranium prices in the international market, if only at the margins. Zagnoli testified that, in his view, the cartel was “moderately successful” in raising international uranium prices. In his written statement, undoubtedly prepared earlier by Gulf ’s lawyers, McAfee argued, “The foreign uranium cartel, which was the offspring of the Canadian government and the government-owned uranium industries of other countries, simply had no discernible impact on either the domestic or foreign uranium commerce of the United States.”

A young, aggressive freshman Democrat from Tennessee, Albert Gore Jr., pushed Zagnoli to admit that the cartel pushed up uranium prices in the United States. Gore was attempting to buttress the case of the Tennessee Valley Authority, which had joined Westinghouse in its suit against Gulf, its unfriendly neighbor and adversary in the multi-million-dollar uranium supply lawsuit. The most that Zagnoli would concede was that, if there was an effect on U.S. prices, it was “insignificant.”

But the Gulf documents did not produce the kind of self-incriminating evidence the congressional investigators had hoped for. As the New York Times coverage indicated, the record was inconclusive. Washington bureau investigative reporter David Burnham reported that some of the documents “indicated that Gulf had taken part in the uranium cartel as a result of pressure from the Canadian government and that the marketing agreements had not influenced the price of uranium in the United States.” A June 1972 legal memo by Gulf lawyer Roy D. Jackson advised the company, “The fountainhead of our antitrust defense is the effective Canadian government direction that Gulf participate in the cartel, buttressed by the project minimal impact on the trade or commerce of the United States.” Jackson’s legal memo also argued that it was important for Gulf “to become a sophisticated and substantial participant in worldwide uranium matters as it was for us to undertake similar efforts with respect to oil and gas thirty or forty years ago. Having a representative on the governing board of the world marketing organization would be helpful in achieving this objective.”

By the end of the summer, the Moss investigation had fizzled out. Given the inconclusive records from Gulf, the apparent attempts by the cartel to avoid an entanglement with the U.S. market and antitrust laws, and pressure from foreign governments on the Carter administration, Moss gave up. The subcommittee held a final round of hearings in Nashville, at Gore’s urging. The August 15, 1977, hearing was designed to give the TVA a podium to make its charges against the cartel, but the power agency’s appearance disappointed Gore, who presided at the session, and others seeking to establish Gulf’s perfidy. Red Wagner, the TVA’s chairman, was unable to provide definitive evidence that the cartel pushed up the price it was paying for uranium fuel. The TVA’s Jack Gilleland, assistant power manager, told the subcommittee that the power agency had negotiated with cartel members for twenty million pounds of uranium without ever raising the issue of the cartel and controlled prices. It also appeared that the cartel had disbanded its price-setting regime, although the Uranium Institute remained as a trade association.

The New York Times headline captured the subcommittee’s frustration: “Effect of Uranium Cartel on Electricity Eludes Inquiry.” The article’s first paragraph said, “A Congressional subcommittee investigating an international uranium cartel, which says it has disbanded, failed today in its efforts to determine what impact the price-fixing plan has had upon domestic electricity prices.”

Over the next few months, the lawsuits brought by Westinghouse and the TVA against nineteen U.S. uranium producers predictably petered out, as plaintiffs and defendants worked out negotiated settlements. Cloaked by confidentiality agreements, the details of the settlements with Westinghouse were never revealed. But the TVA, as a federal government entity, had to reveal its deals, which were most likely in line with those between Westinghouse and the producers. According to Friedburg, “Cash payments to [the] TVA have been relatively small (a few million dollars compared to potential damage claims of hundreds of millions).”

The Justice Department’s antitrust investigation of the uranium cartel also sputtered to a close. The DOJ staff concluded that the cartel had broken U.S. law, but the Carter administration refused to take the case any further. Justice sought no indictments. The only legal action was a 1978 Justice Department misdemeanor charge against Gulf, with a penalty of a puny $50,000. Gulf copped a nolo contendere plea, agreeing to the fine but not admitting any guilt in the matter.

Did the cartel push up U.S. uranium prices? Probably not—or not to any significant degree. While U.S. uranium prices rose from under six dollars per pound to over twenty dollars by the mid-1970s, that surely had more to do with the freeing of the market from control by the Atomic Energy Commission. As part of the policy decision to break up the U.S. government’s postwar atomic energy octopus, dividing the regulators from the atomic power promoters and ending the congressional Joint Committee on Atomic Energy, the government also let free-market forces have their way with uranium supply, and the artificial prices of the AEC regime ended. Had the AEC not decided to run uranium as a government enterprise from the start—a failed experiment in socialism—the cartel likely would never have come to life.

19. Breeding at the Turkey Farm

Tom Swift, the fictional teenage scientist and prodigious inventor, would surely have found a kindred spirit some forty years later in David Hahn, a real teenager who turned his pursuit of a Boy Scouts atomic energy merit badge into a tiny, crude but dangerous backyard breeder reactor. It truly was life unintentionally imitating art, if one dare call the Tom Swift series of books for boys “art.”

Hahn, who grew up in Commerce Township in central Michigan, was both an “archetypal suburban boy” and a scientific prodigy, turning his bedroom into a hazardous chemical waste dump by the time he became a teenager in 1989. His boyhood experiments with chemistry sets and household cleansers and other products yielded dyes, caustics, and explosives. One account of his activities described his boyhood bedroom: “The walls were badly pockmarked from a multitude of chemical explosions, and the carpet was so stained that it eventually had to be ripped out. Even the padding and plywood subflooring underneath was stained blue from spills of Indole, an alkaloid derived from indigo pigment that David used to make natural-highlight shampoos.”

Then David discovered the atom. His father Ken, a former Boy Scout, pushed his son into joining the scouts as a way to harness his energy and inquisitiveness. David loved the scouts and began assembling an impressive array of merit badges, the path toward the ultimate in scouting status—an Eagle Scout. David soon became enamored of the atomic energy badge, which the scouts had offered since 1963, when then AEC chairman Glenn Seaborg worked with the Boy Scouts of America to create the badge.

David plunged head first into the study of atomic energy, focusing on several of the options for fulfilling the merit badge requirements, including “build a Geiger counter” and “build a model of a reactor.” David earned the badge by 1991, when he was fifteen, but that was only the beginning of his interests in the atom. Hahn set out to build a working model of a breeder reactor, one that would turn thorium-232 into fissionable uranium-233. That task consumed him over the next four years.

It isn’t known whether his crude atomic energy reactor actually accomplished transmutation, using thorium from the mantles of camp stoves, radium from old glow-in-the-dark camp stoves, aluminum foil, and expertise gathered by posing as a physics professor in letters to the U.S. Nuclear Regulatory Commission. But he did leave a substantial radioactive mess, contaminating a garden shed and yard. Federal officials from the NRC and the Environmental Protection Agency in radiation moon suits had to mount an atomic cleanup with a price tag (paid by taxpayers) in excess of $40,000.

What Hahn tried to do was what physicists and engineers in the United States (and elsewhere) had been trying for decades, with only slightly more definitive success: to create a process that could use the power of the fission process to produce more fuel than it consumed. Called breeding, if it could work at an economic scale, breeding could render moot the question of the supply of uranium in the world. Breeding came to be the Holy Grail of atomic energy, with little to show in results. But the lack of progress did not deter the true believers in the slightest.

Nuclear physicists discovered the principles of breeding early in their inquiries into fission. In 1939, Danish physics pioneer Niels Bohr theorized in the journal Physical Review on fissionable elements beyond uranium. In 1941, chemist Glenn Seaborg discovered how neutrons bombarding U-238 could produce plutonium, a fissionable element. His team followed with the discovery of how to make fissionable U-233 from thorium-232, a very abundant element that is slightly radioactive but will not sustain a fission chain reaction.

The advantage of a breeder was obvious—the ability to create limitless fuel for civilian power plants and the explosive cores of atomic bombs. In April 1944, a group of the atomic illuminati, including Fermi, Szilard, Wigner, and Alvin Weinberg, met in Chicago to talk about how to use fission to light lights, power industry, heat homes, and breed more fuel than the reactions used. In 1945, Fermi proclaimed, “The country which first develops a breeder reactor will have a great competitive advantage in atomic energy.” But breeder technology had to wait for the bomb-building Manhattan Project to come to an end before it got full government attention.

One of Fermi’s students and closest Chicago associates, Walter Zinn, had developed an expertise in reactor design and construction. Zinn was the scientist who actually pulled the control rod out of Fermi’s pile in the squash court under the football stadium at the University of Chicago on December 2, 1942, starting the world’s first sustained chain reaction.

By about the same time as the 1944 meeting, Zinn had developed a theoretical design for a plant that would generate both electricity and excess fuel. Zinn’s reactor would use fast neutrons—atomic particles not slowed by a moderator in order to improve the chain reaction in U-235—to breed plutonium-239 from natural uranium-238. One important element in Zinn’s thinking about breeders, which would bedevil all future breeder projects, was the need for a way to cool the reactor that did not also slow down the neutrons. Most conventional power reactors use ordinary water to both cool the machine and slow the neutrons.

By early 1946, Zinn’s conceptual breeder design matured. He would use a mixture of explosive liquid metals—sodium and potassium—as a reactor coolant. The fuel would be bomb-grade U-23596 encased in aluminum tubes, with the whole assembly surrounded by a cylinder of U-238. Zinn figured that the neutrons from the fission of U-235 would bombard the natural U-238 blanket, creating more plutonium than the highly enriched uranium fuel that the reactor burned up.

In 1947, the AEC approved construction of Zinn’s Experimental Breeder Reactor–I, which came to be colloquially known as Zinn’s Infernal Pile. Believing the reactor potentially too dangerous to build at Argonne, near Chicago, Zinn pushed the AEC to find a remote site. In 1948 the commission came up with a former Navy ordinance proving ground in the high, remote eastern Idaho desert near Arco. At the time, the scientists and engineers called it Argonne West. The site soon would become the nation’s reactor test site, originally given the name National Reactor Testing Station (NRTS), and today known as the Idaho National Laboratory. Zinn estimated his experimental breeder would cost $2.6 million and need forty kilograms (about eighty-eight pounds) of the AEC’s very sparse inventory of highly enriched U-235.

Construction began in Idaho in 1949. A Chicago crew arrived in early 1951, as the reactor building was being completed, to install the core. In May, Zinn tried to operate the reactor, but it proved a dud. There wasn’t enough fuel in the football-sized core to sustain a reaction. It took another three months to get more highly-enriched uranium from the AEC stockpile and manufacture beefed-up fuel rods. In August 1951, the plant went critical and began four months of low-power tests.

On December 21, 1951, Zinn’s team brought the reactor up to full power. Steam raised by the hot reactor coolant ran to a small steam turbine generator. The most enduring image of EBR-I resulted: four light bulbs glowing brightly from electricity produced from atomic power—the first in the world. The next day, the reactor was generating enough electricity for the entire building.

But the real mission of EBR-I wasn’t to generate electricity. It was to prove that the machine could make excess fuel. In June 1953, the AEC announced that the machine, with a power output of 1.2 MW in heat (0.2 MW of electrical output, about the same generating capacity of a small, gasoline-powered generator) was making one new atom of Pu-239 for each atom of U-235 it was burning.

While it could breed, EBR-I had inherent problems. The first was what the physicists call a “prompt positive power coefficient of reactivity.” In ordinary language, this means that as the power increases, the nuclear reaction speeds up. It is a positive feedback that can lead to an out-of-control reactor. The core could melt and collapse.

The scientists at Argonne understood this problem and used EBR-I to examine the instability of the technology. In late November 1955, during an experiment on the positive reactor feedback, some 40–50 percent of the EBR-I core melted. The Argonne West team removed the damaged core—very carefully—and repaired and operated tiny EBR-I until the end of 1963. A second reactor—EBR-ii—operated as a breeder until 1969.

The Arco breeders established the parameters of future U.S. breeder reactor designs. The machines would be called LMFBRs, standing for “liquid metal fast breeder reactors.” “Fast” refers to neutrons, which are not slowed down as they are in conventional fission reactors. The faster the neutrons, the more plutonium will result from the reaction. “Liquid metal” refers to the coolant, the metal sodium. Liquid sodium is great at capturing and transferring heat. Sodium also boils at a very high temperature; unlike water, it doesn’t have to be under pressure to keep from boiling away as a gas. Finally, sodium, unlike water, doesn’t corrode the metal pipes, pumps, and valves it runs through.

But sodium has real problems, which ultimately made it the chemical Achilles’ heel of breeder reactors. Sodium, with its high melting temperature, has to be kept hot at all times, or it turns solid. Sodium is also extremely nasty when it contacts water, including water vapor. It catches on fire and makes dense clouds of billowing white smoke. Sodium also absorbs neutrons, producing radioactive Na-24 as it passes through the reactor core. So the liquid metal coolant must be kept separate from the liquid sodium used to generate steam in heat transfer equipment known as steam generators. All LMFBRs have two liquid sodium loops: one to cool the reactor and the other to make steam.

Even before EBR-I came to life, an electric company executive had become sold on the promise of the breeder and was assembling a group of like-minded businessmen to launch a commercial breeder. In December 1951, Walker Cisler, a brilliant, Cornell-educated engineer, was promoted to president of Detroit Edison, a large, investor-owned utility serving the Motor City and surrounding Michigan suburbs. Cisler, who had been Edison’s chief engineer, ran the utilities program for the Supreme Headquarters Allied Expeditionary Force during World War II, helping rebuild war-torn electric systems in Europe.

Returning to Detroit in 1945, Cisler became an advocate of the future of atomic power for generating electricity. As executive secretary of the AEC’s industrial Advisory Group in 1947–1948, he advised the commission on its policy for civilian electricity generating plants. Historians George Mazuzan and Samuel Walker described Cisler: “Handsome, articulate, pragmatic, and confident, he moved with ease among top government officials as well as in the industrial, social, and civic circles of Detroit.”

Cisler believed that the best way to develop nuclear electric generating plants was through the private sector. He was also convinced that building a commercial-scale breeder reactor was a reasonable and prudent investment in the future, not, as many experts believed at the time, a wild shot in the nuclear dark.

When he was named Detroit Edison president, Cisler, along with officials from Dow Chemical of Midland, Michigan, presented a plan to the AEC to develop a commercial-scale breeder that would generate 100 MW of electricity and produce its own fuel after its initial fueling with highly-enriched uranium from the AEC stockpile. The AEC approved the design phase of Cisler’s project, to be known as the Enrico Fermi Breeder Reactor Project, on December 19, 1951, two days before Walter Zinn powered up EBR-I.

Cisler began raising private-sector investment for his project. By October 1952, he had formed a nuclear development department at Detroit Edison and lined up fifteen investor-owned electric utility companies to support his breeder, along with an array of manufacturing and engineering companies. They formed a technical group, with Cisler as chief and legendary physicist Hans Bethe as a consultant, to begin detailed reactor design.

In 1954, Congress rewrote the 1946 Atomic Energy Act to boost civilian nuclear generating plants, following Eisenhower’s Atoms for Peace initiative. The AEC announced it would accept proposals from the private sector for reactors under its power demonstration program. In 1955, Cisler formed the Power Reactor Development Company (PRDC), which he headed, to build, own, and operate a 66 MW breeder reactor on nine hundred acres at Lagoona Beach on the shore of Lake Michigan between Detroit and Toledo, Ohio.

Under AEC procedures, the Fermi project was subject to review by the Advisory Committee on Reactor Safeguards. The ACRS established a subcommittee, chaired by Harvey Brooks, engineering and applied physics professor at Harvard University, to review the plan. Ultimately, the ACRS was quite skeptical of Cisler’s leap of engineering faith, advising more research—including work addressing serious safety questions about an untested technology, such as the positive feedback that could cause the reactor to melt down. PRDC, said the advisory committee, was advocating a project so bold “as to risk the health and safety of the public.”

Nonetheless, PRDC formally applied for an AEC construction permit in January 1956, and the commission approved the project on August 4, 1956, brushing aside the ACRS objections and stressing that it would not issue a final operating license until the safety questions were fully resolved to its satisfaction. PRDC broke ground four days later and started pouring concrete in December. After a legal detour through the U.S. Supreme Court on a challenge to the AEC procedures by four labor unions, which the AEC won, the AEC granted a conditional operating license and Fermi I went critical on August 23, 1963. That was the high point for the doomed Fermi I project.

On October 5, 1966, the plant “scrammed,” or shut down suddenly and automatically. When engineers studied the accident, they quickly discovered that two fuel assemblies (out of more than one hundred) had melted. Much later they determined that two loose zirconium shields obstructed the flow of sodium. There was no radioactive contamination outside the reactor, but the fuel-melt was sobering, demonstrating that pushing a tricky and dangerous technology took untoward risks. As Mazuzan and Walker wrote, “A meltdown is the most critical problem any reactor can have. When the fuel melts, its behavior can become unpredictable.”

Unscrambling the meltdown mystery and repairing the damage took four years. According to an analysis by the Union of Concerned Scientists, “it took months to remove the suspect fuel assemblies from the reactor core and ship them to Battelle Memorial Institute in Ohio for examination. It took longer to decontaminate the sodium loop and reactor components, drain the sodium loop sufficiently to probe for the cause of the meltdown, locate the offending parts, remove them, and put everything back together.” In May 1970, the plant was ready to restart. A sodium explosion halted the startup until July. The plant reached full power again in October 1970; during 1971 it operated fitfully, averaging only 3.4 percent of full power during the year. PRDC, foreseeing the end, refused to buy new fuel for the plant. In August 1972, the AEC denied an extension of the operating license. The plant shut down for good in September 1972.

The AEC’s attitude toward the problems at Fermi I was, to put it gently, uncomprehending. The UCS analysis critiqued the agency for acting like a “hall monitor.” It continues, “The agency passively reviewed the reports submitted to it by the Power Reactor Development Corporation and sent the occasional inspector to the site apparently more to satisfy geek needs like checking out the periscope developed to ‘peer’ through the sodium for the mysterious foreign objects than to audit recovery efforts. There was no discernible regulatory oversight by the AEC before this event or during recovery from it.”

One of the most clear-sighted and practical pioneers of nuclear power was Adm. Hyman Rickover, the father of the nuclear Navy and the creator of the USS Nautilus, the Navy’s first nuclear submarine. He had early hands-on experience with liquid sodium–cooled breeder reactors in the USS Seawolf, the Navy’s second nuclear boat. By 1956, Rickover had already decided to scrap the sodium breeder power plant and replace it with a light-water reactor like the power plant in the Nautilus. Sodium-cooled systems, Rickover said, were “expensive to build, complex to operate, susceptible to prolonged shutdown as a result of even minor malfunctions, and difficult and time-consuming to repair.”

Nonetheless, the Atomic Energy Commission, still deluded by the myth of uranium scarcity, was betting heavily, with taxpayer money, on breeder reactors. Any problems encountered along the way were, in the AEC’s views, just technical, engineering problems that could be easily overcome. Thus came about the Götterdämmerung for breeder reactors in America: the Clinch River Breeder Reactor Project.

The skeptical views of its advisory committee and the problems at Arco and Fermi I in no way diverted the AEC away from its breeder enthusiasm. Inside the AEC staff, Milt Shaw, the long-time director of reactor technology, was the leading advocate for breeder reactors and what many had begun calling a “plutonium economy.” In 1968, in an assumption-laden economic forecast of the need for breeders, Shaw wrote, “We have the potential to satisfy energy needs of mankind for a very long time by the process of breeding.” During the late 1960s, Shaw curtailed safety research and development funds for conventional light-water reactors in order to boost spending on breeders. Shaw assiduously worked with the congressional joint committee, where California Democratic Rep. Chet Holifield, a long-time member of the joint committee, took the vows in the church of the holy breeder. Holifield termed breeders “indispensable.”

The commission also wrapped itself in the breeding blanket. Chairman Glenn Seaborg proclaimed breeders “a priority national goal” and “the most decisive single step that could be taken now toward assuring an essentially unlimited energy supply, free from problems of fuel resources and atmospheric contamination.” Seaborg took that enthusiasm to the White House, where, in an April 1971 meeting, he persuaded President Richard Nixon to go all-out for breeders. Nixon was preparing to deliver an energy message to Congress later that spring.

On June 4, 1971, Nixon’s message went to the Capitol. Asserting “a sufficient supply of clean energy is essential if we are to sustain healthy economic growth and improve the quality of our national life,” Nixon outlined a series of steps his government would take, starting with “a commitment to complete the successful demonstration of the liquid metal fast breeder reactor by 1980.” A year earlier, Nixon had proposed creating a new, overarching agency called the Department of Natural Resources to swallow the Interior Department and major programs from a dozen other cabinet-level agencies, as well as independent agencies such as the AEC. In his “Special Message to the Congress on Energy Resources,” Nixon proposed “a single structure within the Department of Natural Resources uniting all important energy resource development programs.”

Creating the new department was probably more important to Nixon than the breeder reactor demonstration project, but he needed to back the breeder to win Holifield’s backing for the reorganization. Not only was Holifield a key member of the Joint Committee on Atomic Energy, but he also was chairman of the House Government Operations Committee, which would have to approve Nixon’s reorganization plan. The Department of Natural Resources quickly sank into the mists of administrative history as another failed reorganization, while the breeder program continued for more than a decade, gobbling up government funds, before it, too, failed.

A 1972 AEC memorandum of understanding laid out the plans for the breeder. It was followed by a series of detailed contracts among the federal government and the Tennessee Valley Authority (always a patsy for anything atomic and free of state or federal economic regulation), Chicago’s Commonwealth Edison Co., and the Breeder Reactor Corp., with Westinghouse as the builder of the reactor. The plans called for construction to begin in 1974 and power generation in 1981.

The site for the demonstration reactor, planned to have an electric capacity of 350 MW, would be some twelve hundred acres of AEC land on the Clinch River near the Oak Ridge weapons laboratory. The $699 million Clinch River Breeder Reactor would be a sodium-cooled reactor, fueled with a mixture of uranium and plutonium, and breeding more plutonium than it used in fuel. The Associated Press reported, “Private utilities across the country have pledged $240 million toward the project. TVA is putting up $22 million, and Commonwealth Edison $11.4 million. The balance will be supplied by the atomic agency.”

The project seemed uncontroversial at the time but soon was generating plenty of political heat. Plutonium was the first source of friction. It didn’t take long for many to realize that the plutonium economy would result in the spread of nuclear bombs around the world. Plutonium was a far better tool for building A-bombs than uranium, requiring only a small amount of the element to produce the guts of a nuclear weapon. In 1974, India, which had refused to sign the Nuclear Non-Proliferation Treaty, using plutonium reprocessed with U.S. help through an Atoms for Peace project, exploded an atomic bomb. The path from the peaceful atom to weapons of mass destruction went through plutonium reprocessing. In October 1976, President Gerald Ford put commercial plutonium reprocessing on hold. In March 1977, newly-installed President Jimmy Carter made Ford’s hold permanent and also moved to kill the Clinch River breeder.

Cost escalation—the bane of nuclear programs throughout history— was also undermining the Clinch River project. The AEC’s 1972 cost estimate for the project was $699 million, with the United States paying $422 million, and the private utilities covering the rest. When Westinghouse and the AEC finished the reference design for the plant, the cost estimate had risen to $1.7 billion. The private sector contribution was capped under the contract with the AEC. The taxpayers would have to eat the excess. By the time Congress finally drove a political stake through the heart of the breeder in 1983, the cost estimate topped an eye-popping $4 billion.

The endgame for the breeder lasted nearly seven years. The Carter administration proposed killing the project in 1977, but regional politics and the prospects for lavish pork barrel spending, combined with the administration’s inept and cantankerous relations with Congress, kept the project alive but not thriving throughout the Carter years.

Some warning signs for breeder boosters came when ideological conservatives began questioning the logic of the government performing research and development programs for large, well-financed private companies. A young, hard-line GOP congressman from Michigan, David Stockman, in a 1977 press release slammed the Clinch River project as “totally incompatible with our free market approach to energy policy” and “a large uneconomic subsidy” to the nuclear industry.

When Ronald Reagan made Carter a one-term president in 1980, and the Republicans captured the Senate, the breeder boys were ecstatic. Tennessee’s Republican Sen. Howard Baker, the most ardent supporter of Clinch River in Congress, became Senate Majority Leader. In the House, where the Democrats still ruled, Tennessee Rep. Marilyn Lloyd Bouquard, whose district included Oak Ridge, became chair of the House Science Committee’s energy subcommittee and was a senior member of the Public Works Committee. There were a few small clouds on the horizon. One was Stockman, the spending hawk. He had become Reagan’s budget director.

The New York Times in March 1981, as Reagan’s first budget message went to Congress, reported from Oak Ridge, “Soon, however, the deer and the cottontails will probably have to move over and make a little room, because this is the site of the much-debated and much-delayed Clinch River Breeder Reactor, which President Carter tried to kill but only wounded in his fight to halt proliferation of nuclear weapons. But the political upheaval that recently shook the ground four hundred miles to the northeast in Washington appears to mean that the breeder—which makes, or ‘breeds’ more plutonium fuel than it consumes while generating electric power—will finally be built.”

In a great political irony, a solidly-Democratic Congress refused the plan of the Democratic president to shut down a costly and vastly over-budget spending project that also threatened to upset the international nuclear non-proliferation regime. Then, a Congress with a Republican Senate and a staunch conservative in the White House killed the breeder. Stockman’s 1977 critique foreshadowed a key reason. Political conservatives abandoned Clinch River. In an influential 1982 paper—“The Clinch River Folly”— Henry Sokolski, a young analyst for the Heritage Foundation, a right-wing think tank that had strongly supported Reagan’s election, wrote:

For many conservatives, Clinch River represents a dilemma. They are, on the one hand, strongly supportive of nuclear energy, but they are also concerned about the burgeoning federal deficit. Their opposition to the Clinch River Breeder, therefore, is born more out of a concern to limit federal spending than opposition to nuclear power. The stakes are high. If, as spokesmen for the nuclear industry contend, the death of Clinch River will lead inevitably to the death of nuclear power in the United States, conservatives would undoubtedly continue to support the project. But the validity of this argument has become steadily more doubtful as new uranium discoveries, a general slowdown in the construction of nuclear power plants, and increasingly large cost overruns bring the wisdom of supporting Clinch River into question.

Facing a powerful right-left coalition seeking to kill Clinch River, Howard Baker mounted a furious campaign to save the project in his home state. But early in the morning of October 26, 1983, the Senate dealt the death blow to the project, voting 56–40 against an appropriation of $1.5 billion for the staggering breeder program, on top of some $1.7 billion that had already been spent, with nothing to show for the expenditure. Sen. Dale Bumpers, an Arkansas Democrat and member of the Senate Energy Committee, said, “We put some money down a rat-hole and decided not to spend any more. It was a very dangerous course. The technology is considered by some respected scientists as less than viable.”

The path to endless energy through a plutonium economy proved to be a very expensive dead end for U.S. taxpayers. A conservative 1975 General Accounting Office estimate put AEC liquid metal fast breeder reactor spending for fiscal years 1948–1974 at $1.8 billion in 1975 dollars. Clinch River nearly doubled that figure.

On December 15, 1983, the U.S. Nuclear Regulatory Commission, one of the successors of the AEC, revoked a preliminary construction license for the Clinch River Breeder Reactor it had issued the year before. “With this action,” wrote a group of academics studying the history of breeder reactors around the world in 2010, “breeder reactor development in the United States essentially ended.”

Breeder enthusiasm was built on bad assumptions by policymakers and resultant bad policy. In a 1972 paper, promoting the notion that low-cost uranium would soon run out, justifying breeders at nearly any cost, AEC head of reactor development Milt Shaw highlighted the problem with the nation’s heavy breathing over breeders: “it should be noted that analytic studies which extend fifty years into the future should be used primarily to indicate trends that may result from changes in parameters. The validity of the projections is directly dependent on the validity of the assumptions used in the study. The reader should keep this fact and the assumptions clearly in mind when reviewing the results and avoid a natural tendency to use such parameter studies that involve projections into the future as absolute forecasts.”

—Kennedy Maize is a POWER contributing editor and executive editor of MANAGING POWER. Too Dumb to Meter is available from the POWER Bookstore or Amazon.com and is serialized by permission.

Videos & Infographics

Innovative Valve Design Featured at Power Event

Everlasting Valve Co.’s self-lapping, rotating disc valve was on display during the ELECTRIC POWER Conference and Exhibition, held in Nashville, Tennessee, March 19–22, 2018. While other metal-sealed valves wear out over time, the seal in the Everlasting Valve gets tighter and stronger as it wears in. As the valve opens and closes, the disc rotates incrementally, uniformly polishing away scratches and creating an ever-tightening seal.